U.S. and EU agreement on reinsurance

The United States and European Union have scheduled a ceremony for today for the signing of a bilateral agreement on prudential insurance and reinsurance measures.

Both sides announced in July their intention to sign the agreement, also known as a covered agreement in the U.S.

The parties believe the agreement represents a step forward in U.S. – EU cooperation on insurance and reinsurance. In a joint statement, they said it conveys “benefits to EU and U.S. insurers and reinsurers operating across the Atlantic by offering them regulatory certainty, while maintaining consumer protections.”

The agreement was negotiated by the Obama Administration in talks that began in 2015. It was announced on January 13, 2017 in the final days of the previous administration.

The agreement – which is a “covered agreement” in the meaning of the Dodd-Frank Act and an agreement under Article 218 of the Treaty on the Functioning of the European Union – addresses three areas of insurance oversight: reinsurance; group supervision; and the exchange of insurance information between supervisors.

With regard to reinsurance, it will “eliminate collateral and local presence requirements for EU and U.S. reinsurers operating in each other’s markets.”